Thursday, July 10, 2014

Bees love capitalism

Economist Timothy Taylor has written an impressive post about the history of changes in the academic understanding of beekeeping economics, and showed how market forces have already provided a solution to the colony collapse issue of mysterious bee deaths. Taylor shows that despite the high bee deaths, private beekeepers have grown the bee population while the government is just not putting a task force together to find a policy solution

Economists have often used beekeeping as an example when discussing externalities, as apple farmers benefit from the bees who dutifully pollinate their apple trees as a side effect of living next t a bee keeper. There has always been a lot of discussion in how compensation can be worked out between apple farmers and beekeepers, and the issue has been shaken up a few times among academics.

Cheung pointed out that while Meade and others had interpreted the externality of bees as a reason for government subsidies and taxes, the actual real-life beekeeper industry had dealt with the issue through property rights... In short, while economists like Meade were hypothesizing about how markets couldn't address the issues of bees, actual beekeepers in real market were signing contracts that seemed to address these problems just fine.

The entire post is an interesting read, and should be required reading for science fans who need a reminder to why economics should be considered before they make policy recommendations.